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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5029
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I have a flat in London which is let as ' furnished holiday

Resolved Question:

I have a flat in London which is let as ' furnished holiday letting. I had it furnished at a cost of 15,000pounds. Can I claim capital allowance? If so how much.
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

You can claim capital allowance on furnished holiday letting provided the property is avialable for holiday letting for 210 days and it is let for 105 days or more.

Here is a link to HMRC site that shows what constitutes plant and machinery. Provided your expenditure falls in any of the category classified as plant and machinery then you can claim annual investment allowance at 100% of the expenditure i.e. £15k.
https://www.gov.uk/capital-allowances/what-you-can-claim-on

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

I know that one can claim plant and machinery as investment. What I need to know is the furniture like beds, TV set etc.

Expert:  taxadvisor.uk replied 2 years ago.
Thank you for your reply.
I am on board a train and will revert to you later this evening.
Many thanks.
Expert:  taxadvisor.uk replied 2 years ago.
Thank you for your patience. I had just started a long train journey when I picked your reply.

Certain expenditure e.g replacement of mattress can be regarded as revenue expenditure and charged against rental income in arriving at the profit from furnished holiday letting.

You mentioned items of furniture and TV sets etc... these items certainly fall within the broad meaning of plant and machinery for capital allowances and you would be able to claim annual investment allowance of 100% of expenditure as I highlighted in my earlier posting.

You will find infomation on what expenditure qualifies for plant and machinery allowance under General list: assets which are plant and machinery (s23 CAA2001) here

http://www.rossmartin.co.uk/capital-allowances-75082/293-what-qualifies-as-plant-a-machinery


I hope this is helpful and answers your question.
Customer: replied 2 years ago.

I am suppose to file a 'Tax return for a non-resident company liable to Income Tax' form. SA700. The company's income is from furnished holiday letting. Where in this from shall I claim this 15,000pounds. It seems that I am limited to boxes 2.11 to 2.24

Expert:  taxadvisor.uk replied 2 years ago.
Thank you for your reply.

If you have claimed capital allowances on expenditure in the past then it is most likely to form part of main pool where WDA is 18% on unclaimed capital allowance.

You add to it any expenditure you wish to claim under AIA (annual investment allowance).
If you have not claimed any capital allowances in the past, then you should put £15,000 in box 2.18 as it would form part of main pool.

Information on main pool can be found here
https://www.gov.uk/work-out-capital-allowances/rates-and-pools

I hope this is helpful and answers your question.


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